Farms' Yield Is Extra Green

Some Growers Are Cashing Out As Prices For Agricultural Land Skyrocket.

April 11, 2005|By Jerry W. Jackson, Sentinel Staff Writer

Condos and oceanfront lots are not the only hot properties in fast-growing Florida. Farmland prices are soaring.

Most agriculture land in the state saw double-digit price increases in the past year, including in Central Florida, where the average value of mature orange groves rose 12 percent, to $6,409 per acre.

Prime land in hot corridors is selling for a lot more than that -- pushing pastures, citrus and former groves into subdivisions and shopping centers at a rapid clip.

Rapidly rising land prices raise the stakes for many farmers. Their choice: stay in the business or cash out.

Orange County foliage grower Monty Knox said a tract of 400-plus acres of former citrus just south of his Knox Nursery near Winter Garden recently sold for $22 million.

"When we bought this land out here nine years ago, we paid $7,500 an acre. Now some of the land around here is going for $50,000 an acre."

Growth nearby between Winter Garden and Clermont soon will gobble some of the groves owned by the McKinnon Corp., a family-owned citrus company with deep roots in Orange County. From the McKinnon groves, citrus grower Scott Boyd can see the future -- and it's all houses.

Boyd's grandfather Daniel L. McKinnon was a prominent west Orange citrus grower in the 1940s, and his great-grandfather before that. But Boyd, 35, now has his real-estate broker's license and is preparing for a different future, foreseeing the day when his family will have little if any citrus in Central Florida.

"We have to diversify," he said, both in terms of land use and careers. His father, Maurice Boyd, said the family recently sold about 55 acres for a housing development between Winter Garden and Oakland.

They still have citrus in remote parts of Collier and Hendry counties. But even there, growth is closing in -- and citrus canker's spread has made the future even more uncertain.

"I'm pessimistic," Maurice Boyd said about the future of citrus. "The hurricanes blew it [canker] all over."

The latest snapshot on land prices was released this month by the University of Florida. The annual survey was taken last spring, drawing on the expertise of farmers, appraisers, county extension agents and others.

Because of the timing, the 2004 report does not take into account the effects of the hurricanes that hit the state in the summer, said John Reynolds, a professor emeritus with UF's Institute of Food and Agricultural Sciences and author of the study. Those effects will be noted in the 2005 survey.

Reynolds also cautioned that individual parcels vary dramatically in price for many reasons, so the value of the survey is mainly in spotting trends.

Other types of agricultural land, much of it destined for development, saw values rise even faster than prices for citrus, the UF study found.

Pastureland and cropland, for example, soared more than 20 percent in value in Central Florida.

In fast-growing parts of South Florida, the pace was hotter, with average cropland prices rising 58 percent, and pastureland by 76 percent.

"It's unusual. These are very likely records," said Reynolds, who has been studying Florida farmland values since the 1980s.

What's driving prices up? Developers point to soaring population growth.

"The demand is huge," said Jim Cooper, senior vice president with The Ginn Co., a major Central Florida builder working projects in former rural land such as Lake County. "People coming here -- that's what's driving this."

Cooper said development costs in Florida are rising for many reasons, including land-price increases, but builders also play a role in the changing economics.

"If you think the price is too high, someone walks in the door and pays it. He who hesitates is lost," Cooper said.

Some farm segments are faring better than others -- holding on to the land and preserving slices of agriculture in the shadows of cities and suburbs. The Knox family, for example, plans to put more greenhouses on its 33 acres -- despite high land prices and homes moving in from every direction.

Landscape-foliage plants are selling well, Monty Knox said, so the business is profitable enough to stave off the need to sell, at least for now.

Orlando lawyer Paul R. Linder, 47, who owns citrus and raises cattle in Christmas in east Orange, said he also hopes to stay in agriculture, partly for sentimental reasons, if not financial. He recalls that his grandfather, Paul C. Linder, grew citrus in Lake County in the 1920s and later added cattle to his holdings, and now Linder's 10-year old son "can ride a horse and crack a whip."